Henry Cheng’s Chongbang Group has purchased a commercial site in Shanghai’s Hongkou district for RMB 7.1 billion ($1.05 billion), according to records from the city’s Land Transaction Market website.
The developer, which was founded by former Shui On Land executive Henry Cheng and Stephen Wong of Hong Kong’s Edward Wong Development in 2003, is paying more than RMB 36,000 per square metre of floor area for the combined office and retail project atop the Sichuan Road light rail station on the city’s metro line two.
Mingkang Co., Ltd, which is understood to be a subsidiary of Chongbang, acquired the project via a public land tender announced by the city in June, paying the auction minimum for the 46,100 square metre site. The tender, which began on July 24, was concluded the same day, despite originally being scheduled to remain open until August 2nd.
Building a 195,000 SQM Project in Hongkou
Chongbang’s new Hongkou prize is approved for construction of up to 194,800 square metres of above ground floor area, in addition to another 110,000 square meters of underground space. Total investment in the new project is expected to exceed RMB 15 billion. The developer is known for its set of Life Hub commercial projects in Shanghai and other cities in the Yangtze River Delta region.
Thirty to fifty percent of the Hongkou project is to be developed for retail use with the other 50 to 70 percent designated for office space, with the height capped at 180 metres. Land use rights for the project, according to the original tender documents, are 50 years for the office portion and 40 years for the retail portion.
The site just two subway stations north of Shanghai’s East Nanjing Road commercial area lies west of Sichuan North Road and stretches another full block west to Jiangxi North Road. The developer is also required to build a literary history museum of at least 14,000 square meters as part of the project, with the museum to be transferred to the Hongkou government free of charge when construction is completed.
Inquiries by Mingtiandi to Chongbang representatives went unanswered by the time of publication.
Shanghai International Plaza, which LaSalle Investment Management purchased for a reported RMB 2.48 billion earlier this year, is just across Sichuan Road from Chongbang’s new project.
Chongbang Builds Commercial Portfolio
Just less than two years ago, Chongbang Group bought back an 80 percent stake in the Life [email protected] project in Shanghai’s Pudong District from Singaporean investors Keppel Land China and Alpha Investment Partners for a combined $516.9 million. Chongbang had originally developed the Pudong project in 2009, with the pair of Keppel Group partners buying their stake from a fund managed by Morgan Stanley.
Chongbang, which is backed by Dutch pension fund APG, and Canada’s Ivanhoe Cambridge, among other investors, opened its first Life Hub project in Shanghai’s Zhabei district in 2006. The company also has commercial projects in Shanghai’s Huangpu and Anting districts, as well as in Hangzhou and Kunshan.